Increasing numbers of small and newer energy suppliers delivering poor customer service

More small and newer energy suppliers are failing to meet decent standards of customer service, according to Citizens Advice’s latest energy star rating league table.

The charity believes these latest figures and recent supplier failures further highlight the need for Ofgem to tighten the rules on who can get a licence to supply energy. It is also calling on the regulator to crack down on poorly performing firms already in the market.

The latest rankings show 5 energy suppliers - Outfox The Market, Eversmart Energy, PFP Energy, Pure Planet and iSupply - achieving an overall score of less than 2 out of 5.

The results (for the period October to December 2018) cover 99% of the market and assess data from 35 gas and electricity supply firms. In the previous 3 months (July to September 2018) just one company scored less than 2 stars out of 5.

At the top end of the table, 21 of the 35 firms evaluated now score at least 3 out of 5 stars. This is up from 19 companies out of 34 last time.

• So Energy holds onto its place at the top of the table for the fifth successive quarter.

• SSE is second with 4.4 stars and the highest placed of the ‘Big 6’ suppliers.

• Npower has the lowest ranking of the ‘Big 6’, in 18th place with a score of 3.15.

Increasing direct debits, tariff changes and contact problems

Citizens Advice has helped customers of suppliers at the bottom of the table and identified some particular issues:

• Outfox The Market: direct debits increasing without explanation and customers unable to contact them to discuss.

• Eversmart Energy: unexpected changes in tariffs and direct debits.

• PFP Energy: direct debits increasing and large unexpected bills.

Tighter licensing rules and better monitoring needed

Citizens Advice is calling on the regulator, Ofgem, to make a number of changes to protect customers:

• Introduce stronger requirements to become a supplier, including ensuring the management team are fit and proper.

• Once suppliers enter the market, they should be subject to tougher ongoing monitoring, backed up by swift compliance and enforcement action.

• Reduce the cost of suppliers exiting the market. Supplier failures in the past year alone have left an estimated £160 million in costs like unpaid industry bills that other customers have to pay.

Gillian Guy, Chief Executive of Citizens Advice, said:

“We have seen too many companies who were completely unprepared to offer acceptable levels of service. A number of these have gone out of business in recent months, leaving customers worried, anxious and in some cases temporarily out of pocket.

“The regulator needs to take urgent action by tightening rules around supplier licences, monitoring existing firms more closely and enforcing standards where these aren’t met.”

“Choosing a new energy supplier can be tricky for many people. Our star rating can help people make more informed choices about switching, not just going for the cheapest tariff.”

Citizens Advice price comparison site

To support customers to save money on their energy bills, Citizens Advice, the official consumer champion for energy, also provides an independent price comparison site.

Full table:

Notes to editors

1. Citizens Advice compares energy suppliers' customer service by looking at information from a number of sources. Information about complaints comes from the Citizens Advice consumer service, the Energy Help Unit and Energy Ombudsman. Citizens Advice uses its legal powers to request information on customer service, billing and switching from suppliers. Information on customer guarantees comes from Energy UK.
2. Energy suppliers are given a score out of 5 for each category. 1 is poor and 5 is excellent. A supplier receives a score of zero if they fail to provide the necessary data or set up appropriate referral arrangements with the Citizens Advice consumer service. Suppliers then receive an overall star rating out of 5. Not all categories are equal with some counting more towards the final score than others. Further information on the methodology can be found here.
3. Several suppliers scored zero for one or more categories in the rating:
4. Pure Planet and Eversmart scored zero for complaints because they had not put in place appropriate arrangements to accept referrals from the Citizens Advice consumer service, as required under section 9 of The Gas and Electricity (Consumer Complaints Handling Standards) Regulations 2008. This means we cannot apply our standard complaints methodology to these companies for this period. Eversmart subsequently put referral arrangements in place in December 2018. We are continuing to work to establish the required referral arrangements with Pure Planet.

5. Pure Planet scored zero for ease of contact as it does not offer an inbound telephone service. We have concerns that this could breach section 3 of The Gas and Electricity (Consumer Complaints Handling Standards) Regulations 2008 and Ofgem’s Standards of Conduct, which require suppliers to make it easy to contact the supplier and to have customer service arrangements which are ‘complete, thorough, fit for purpose and transparent.’ More details on our view of the ongoing need for supplier telephone services arehere.

   Outfox the Market scored zero for billing because it did not provide information on its billing performance. Companies are legally required to respond to formal requests for information from Citizens Advice under the Consumers, Estate Agent and Redress Act 2007.

6. Figure of £160 million costs from supplier failures provided by Cornwall Energy.
7. Citizens Advice is made up of the national charity Citizens Advice; the network of independent local Citizens Advice charities across England and Wales; the Citizens Advice consumer service; and the Witness Service.
8. Our network of charities offers impartial advice online, over the phone, and in person, for free.
9. We helped 2.6 million people face to face, over the phone, by email and webchat in 2017-18. And we had 25 million visits to our website. For full service statistics see our monthly publication Advice trends.
10. Citizens Advice service staff are supported by more than 22,000 trained volunteers, working at over 2,500 service outlets across England and Wales.
11. Citizens Advice is the statutory consumer advocate for energy and postal markets. We provide supplier performance information to consumers and policy analysis to decision makers.
12. You can get consumer advice from the Citizens Advice consumer service on 03454 04 05 06 or 03454 04 05 05 for Welsh language speakers.